Waternola

The Asian development Bank now expects Asian economies to perform worse than earlier anticipated, as economists underestimated the impact of the global economic turmoil. “we knew the crisis was coming; but perhaps we underestimated how hard it would hit,” ADB president Haruhiko Kuroda said at the Special Association of Southeast Asian Nations plus 3 Finance Minister’s meeting in Thailand.

“With continued financing constraints and weakening business sentiment, this global downturn is becoming more severe and prolonged. G3 economies are all in recession. And the IMF now sees 2009 world economic growth at a meager 0.5 percent. We clearly have not reached bottom. And worse, we don’t know what’s lurking around the corner,” the ADB official said. The ADB forecast in December that growth in emerging East Asia would slow to 5.7 percent in 2009, down from an earlier estimate of 6.9 percent. “Things move pretty fast, and our flagship Asian Development Outlook will update-and no doubt lower-our forecasts on March 31,” Kuroda said.

The International Monetary Fund in January projected that the Japanese economy would contract 2.6 percent while China’s growth would slow to 6.7 percent. Asean was seen to grow by only 2.7 percent this year. Korea, Hong Kong, Singapore and Taiwan as a group were seen to contract by 3.9 percent in 2009 after a 2.1 percent growth in 2008, mainly as a result of the massive export slump.

Meanwhile, the Asean Business Advisory Council said regional integration remained critical in the face of the current global financial and economic crisis.